With or Without Lula, Brazil Remains Brazil

With or Without Lula, Brazil Remains Brazil

While Lula is a convinced democrat and his economic management is not likely to drive his country off a cliff, his view of the world is quite different from that of the United States.

Brazilian president Jair Bolsonaro is hard to love. He botched Brazil’s coronavirus response. He speaks with respect for Brazil’s former military government, including figures directly involved in torture, and regularly calls his opponents communists or worse. During the current election cycle, he has suggested that the vote counting may be rigged against him and has involved the military in checking in the balloting system. He turned the celebration of the two hundredth anniversary of Brazilian independence into a partisan rally.

With the election coming shortly (first round on October 2, with a run-off, if needed, on October 30), his principal opponent, former President Luiz Inacio Lula da Silva (known universally as “Lula”) of the leftist Workers Party, is well ahead in the polls, while Bolsonaro’s rhetoric alternates between harsh attacks and somewhat softer approaches as the campaign draws to a close. While the United States has remained scrupulously neutral, two senior U.S. officials visiting Brazil, CIA director William Burns and Defense Secretary Lloyd Austin, have made clear that the United States believes that Brazil’s electoral system is trustworthy and that any military effort to challenge the results is unacceptable.

Lula Went to the Right on Economics…

Polls provide no guarantee of the final result, but a Lula victory seems the more likely outcome. While this may be better for Brazilian democracy, given Bolsonaro’s erratic behavior and openly authoritarian sentiments, Lula’s record over his eight years in power (2003-10), provides reason to believe he will be a difficult partner for American diplomacy should he win.

When Lula took office in 2003 there was concern that, given his background as a union leader and his Workers Party’s radical roots, Brazil would be governed from the far left. Thus there was relief when he proved not to be the next Hugo Chavez. In the face of a troubled economy and concern in international financial circles, he maintained orthodox fiscal and monetary approaches. Over time, he was greatly aided by China’s remarkable boom, which sucked up vast amounts of Brazilian commodities such as iron ore and soybeans, and adopted more expansive policies.

Lula plowed the commodity earnings into extensive social programs, earning him political credit both at home and abroad. His policies, together with his personal history—from shoeshine boy to president—were attractive. President Barack Obama termed him “the most popular politician on earth.” But below the surface of this love feast, under Lula, Brazil had often proven itself to be a headache for the United States.

…and to the Left on Foreign Policy

Brazilian foreign policy was marked by both nationalist ambition for it to take its place among the world’s leading powers and a permissive view of authoritarian leftist regimes in Latin America. Of course, Brazil had a long history of seeing itself as destined for greatness. Indeed, the military government that ruled Brazil from the 1960s to the 1980s used the slogan “Nothing can hold this country back.”

Flush with commodity money, Lula’s Brazil took up the quest for a greater global role. It obtained a larger dues quota (and with it a larger voting share) at the International Monetary Fund. Less successfully, it pressed for a permanent seat on the United Nations Security Council. And as part of this drive, it opened a series of new embassies in Africa and the Caribbean. Although the United States was in theory open to Security Council reform, it made no effort to dilute its own power by getting behind Brazil. (None of the five permanent members have really pressed for Security Council reform, although President Joe Biden, frustrated with Russia’s veto power in the face of its Ukraine invasion, raised the subject in his recent address to the General Assembly. It is unclear, of course, whether the United States would consider Brazil a top candidate for any new permanent seat.)

Under Lula, some of Brazil’s greatest areas of friction with the United States were Middle East issues. In 2010, Brazil granted recognition to the “State of Palestine” to consist of the whole of the pre-1967 West Bank, which triggered several other Latin American countries to do the same, while the United States insisted that this was an issue for direct negotiations between Israel and the Palestinian Authority.

And as the United States was pressing for a Security Council resolution imposing sanctions on Iran for its nuclear program, Brazil and Turkey brokered a deal under which Iran would ship uranium to Turkey in exchange for receiving fuel rods enriched to levels low enough to be used in research reactors but not for nuclear weapons development. The United States saw this as undermining sanctions, while not resolving the underlying issue of Iran’s nuclear efforts. Brazil insisted that the United States had privately encouraged it to negotiate the deal with Iran. Lula himself trumpeted the agreement as having “accomplished more in eighteen hours of conversations” than the Americans had managed in three decades.

Both globally and in the Western Hemisphere, Lula’s foreign policy looked to foster institutions where the United States was absent—and Brazil had a leading role. After an investment analyst proclaimed the leading role of the “BRIC” states—Brazil, Russia, India, and China—the four countries held their first meeting at Yekaterinburg, Russia, in 2009, and in its aftermath called for the creation of a new global reserve currency to replace the dollar.

Brazil sought to organize South America under its leadership, while showing scant regard for the long-standing hemisphere-wide Organization of American States (OAS, which is based in Washington and in which the United States has a leading role). At a summit held in Brasilia in 2005, the Union of South American Nations (UNASUR) was created at a time when the region had seen a “red wave” of new leftist governments with which Brazil perceived an ideological affinity.

No Enemies to the Left

Much to the United States’ chagrin, Brazil maintained close relations with Hugo Chavez’s Venezuela despite its evident authoritarian tendencies. Venezuela, of course, was part of UNASUR. Brazil also sought to bring Venezuela into MERCOSUR, the trade bloc which it had created, together with Argentina, Uruguay, and Paraguay; while Venezuela became a member, it never lived up to its commitments on both trade liberalization and democracy and was suspended in 2016, by which time Brazil and other MERCOSUR members had more conservative governments. And during Lula’s presidency, Brazil joined with Venezuela, Argentina, and other like-minded states in scuppering U.S. ambitions to negotiate a hemisphere-wide Free Trade Area of the Americas.

Venezuela became a site for Brazilian commercial outreach, with the state-owned National Economic and Social Development Bank (Portuguese initials BNDES) providing financing for Brazilian construction firms, notably giant Odebrecht which was engaged in projects ranging from a cable car line in Caracas to a bridge over the Orinoco River. While this supportive relationship had begun under Lula’s predecessors, under his administration BNDES, fueled by Brazil’s commodity-based wealth, became a driver for projecting Brazilian influence not only in Venezuela but throughout Latin America.

This commercial diplomacy came back to haunt Lula when a massive scheme of kickbacks from Odebrecht to officials in Brazil and elsewhere in Latin America was uncovered, leading in 2017 to Lula, now out of office, being convicted of money laundering and corruption. He served 540 days of his nine-year sentence before the conviction was reversed when collusion between judges and prosecutors was discovered.

Foreign policy has been largely absent from the current campaign, although Bolsonaro has sought to paint a Lula victory as putting Brazil on the path to national disaster, citing Venezuela and Argentina as cautionary examples. Lula, for the most part, has kept his campaign focused on domestic matters. He drew some heat when he refused to criticize Nicaraguan ruler Daniel Ortega, saying: “Why can Angela Merkel stay (in office) sixteen years and not Daniel Ortega?” And when Russia invaded Ukraine and the United States and Europe sought global support for sanctions, Lula’s view was that this was that Brazil should stay neutral—“We do not want to be anyone’s enemy”—a position which in fact was close to Bolsonaro’s.

Some Common Ground with the United States

What can the United States expect from Brazil, should Lula return to office? There may be a degree of relief in Washington simply if there is a peaceful transition. And the fact that Bolsonaro has identified himself with President Donald Trump both in substance and style, and received the latter’s endorsement in his re-election campaign, likely means that there would be some satisfaction in the Biden administration should Lula win. The flip side of this is that should Trump (or even another Republican) return to the White House in 2024, a chill in U.S.-Brazilian relations may occur.

There may be common ground between the Biden and a Lula administration on environmental issues. Under Bolsonaro, who has been close to powerful agricultural interests, the deforestation of the Amazon has continued apace, and U.S. diplomacy on climate change has been met only with lip service. Under Lula, should he win, Brazil may be more receptive to U.S. concerns, and may beef up environmental enforcement, although the remoteness of affected areas, the importance of the agricultural sector, and the role of state and local governments may put limits on how far he would go.